close up of coffee cup

Coffee Price Shows Signs of Easing

In early December, coffee prices climbed to a 10-year high, but are now showing signs of easing.

Coffee Prices YTD

Although prices are easing somewhat, they are still higher than they were 10 years ago.

Various sources had previously reported that the increase was mainly due to weather conditions in producing countries such as Brazil, but also to the global supply chain disruption that has occurred since the outbreak of the COVID 19 pandemic.
In particular, the weather conditions in Brazil have not been good for coffee growing, as temperatures have been quite low this year.

But Naturaldeposit has pointed out the circumstances that were present at the last all-time high and compared them with today.

What both periods have in common is the injection of capital into the economy. During the banking crisis, some central banks, such as the U.S. Federal Reserve, launched QE programs to stimulate the economy. The increase in the money supply caused commodity prices to rise, which is what we are currently experiencing. Rising consumer prices mean rising inflation for central bankers, but this is more likely due to the increase in the amount of money in circulation.

Together, all the circumstances are probably responsible for the increase in the price of coffee.

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